QBE settles with Craig Anderson over Herbert Insurance liability
QBE Insurance (International), a unit of Australia's biggest insurer, has settled its battle with former executive Craig Anderson over a $1.5 million liability the firm feared would arise from underwriting business to the failed Herbert Insurance Group.
The Employment Court has signed off on a confidential settlement "which disposes of all the issues in these proceedings" and sealed the file, according to a February 21 judgment by Judge Barry Travis. The dispute was sent to the Employment Court at the request of both QBE and Mr Anderson in December 2011.
QBE had claimed Mr Anderson, its former general manager of corporate and specialist risks, breached his employment agreement by committing the insurer to an extended warranty and consumer protection insurance facility offered by Motorplus NZ without authority to do so, according to the Employment Relations Authority determination removing the hearing to the court.
The dispute stemmed from the failure of Herbert Insurance, whose boss Grant Herbert faces 28 fraud charges from the Serious Fraud Office and is scheduled for a callover appearance in the Auckland District Court tomorrow.
Herbert Insurance was put in receivership and liquidation in 2011, leaving a $3.1 million shortfall owed to insurers.
Last month, former Bunnings senior manager Christopher Green pleaded guilty to accepting secret commissions for sending business Herbert Insurance's way.
The settlement comes after the SFO granted counsel for both parties access to inspect certain documents it held as part of discovery sought by QBE.
QBE had previously claimed Mr Anderson did not take all reasonable steps expected to ensure the insurer received premium payments from broker Herbert Insurance over the policy and tried to cover up the agreement by deleting emails and not handing over the file for the transaction.
Mr Anderson rejected the accusation, saying his agreement with Grant Herbert was to "offer only mechanical breakdown insurance on a 'prior submit and sign off' basis".
He had lodged a counterclaim over the insurer's alleged failure to transfer ownership of shares held on his behalf in an employee share plan.
Dual International, the biggest underwriting unit of Britain's Hyperion Insurance, poached three of QBE's corporate and specialist risk division executives, including Mr Anderson, to set up the local branch in 2011.